<p>I recently got a notice from City of Los Angeles for an amount of 4300 + dollars… <em>ab63 assessment</em>
I’ve worked once as a freelance illustrator where I sold 2 drawings in 2007.
I only make 2600 dollars a year from working as a workstudy at my university!</p>
<p>Apparently they’ve been sending me mails before but since I live on college property, it went to my last year’s address. I’ve been trying to update my addresses, but I don’t know where to update that address for City of Los Angeles.</p>
<p>Anyways, I have no idea why they are charging me 4363 dollars. I think it might be due to the freelance drawing I’ve sold. I think I also called it a business because I wasn’t sure what else to call it and when I looked it up online, that’s what some other freelancing artists did as well. I have not sold a drawing since then, and I’m panicking because I do not have that kind of money!</p>
<p>Is anybody familiar with taxes help me? I’m panicking!</p>
<p>Is there a contact phone number on the notice? Call them and ask for an explanation. Take a note of the date, time, and to whom you talk. Follow up with something written. Ask for a “hold” on the account while you have time to research it. Find a CPA/tax accountant who can make sure it is correct <em>before</em> you pay anything. Be patient–you will probably have to wait until after April 15th for someone to be willing to deal with it.</p>
<p>State and IRS notices are often incorrect. Make sure they have your current correct mailing address for future correspondence. If you do owe it, they should be willing to set up a payment plan.</p>
<p>$4300 would be a very high amount of state/local taxes due. Did you file a federal tax return for that year? You would have owed at least self-employment tax on the income.</p>
<p>Good luck on this. Be pleasant, yet firm with the representative. If you aren’t getting anway, don’t be hesitant to ask for a supervisor.</p>
<p>Thanks, I’ve tried calling them today but it was sent to a machine. I left a message and they said they will call back in 1 or 2 business days.</p>
<p>I’m extremely poor, and I did not have to pay taxes so far due to low income (federal anyhow). I do not have a tax accountant because I would have to pay for the services (once again I’m a poor college student and my parents won’t be much help).</p>
<p>I don’t know where the 4300 dollars are from. What does principal stand for?
I’ve only sold 2 drawings like I said in 2007 in one month. Does that even count as a business? I think they are hitting me with penalties (principal was 1,110 for 2007, penalty was 440) although I didn’t think I was in business.</p>
<p>I’m panicking right now and don’t know what to do! My parents are not even in America right now and I don’t want to tell them anything unti something happens… I really don’t have that kind of money as I live on that amount a year pretty much…</p>
<p>How much did you sell your drawings for?</p>
<p>The taxes sound a lot unless they were sold for a lot (thousands of dollars).</p>
<p>Don’t panic as it could well be a mistake. My daughter had an IRS problem last year that was entirely an error on their part, where they had her owing thousands of dollars and it took 6 months to sort out. In the meantime they were sending her notices of interest and penalties every month and we never got any responses to our letters to them until at the end of 6 months they sent her a check for the $11 they actually owed her plus 33cents interest. Never got an explanation. It was a pain.</p>
<p>Wait until you get the call back and talk to them and find out what it is based on. If you cannot understand over the phone then make an appointment and go see them. There are often tax advocates who can assist you for free if you cannot sort it out yourself.</p>
<p>I sold it for 400 dollars. I shouldn’t have to pay according to small business law and creative artist exemption (unless they are making over 300,000 dollars) but only if I did it in a ‘timely’ manner. It was a year ago so probably not. With the drawings sold, I only made 2900 altogether for 2007…</p>
<p>If the notice if from the city and not the IRS, perhaps you could call the IRS and see what they show as reported income for 2007 for you. Income should reported on a specific form that both you and the government get, W-2, 1099 misc income, etc. If you can get a copt of the deposited income to your bank account that may be helpful as well. Perhaps, if you did not file a tax return, that is all you need to do to clear up the problem.</p>
<p>AB63 Program</p>
<p>Under state legislation, the City has access to basic tax information provided on State income tax returns filed with the Franchise Tax Board. This information is used to identify businesses that owe City business taxes to help pay for critical City services, establish a fairer business tax system and fund future business tax reform and affordable housing. The AB63 Program has resulted in significant revenue for the City of Los Angeles with more than 76,000 new business tax accounts and over $76 million in revenue since inception in 2002. Under state legislation, the local sharing program sunsets in 2011. </p>
<p>Did you file a state tax return?</p>
<p><a href=“http://www.lacity.org/finance/pdf/AB63/AB63Flyer.pdf[/url]”>http://www.lacity.org/finance/pdf/AB63/AB63Flyer.pdf</a></p>
<p><a href=“http://www.lacity.org/finance/pdf/INFOBKLE.pdf[/url]”>http://www.lacity.org/finance/pdf/INFOBKLE.pdf</a></p>
<p>You called it a business and they charged you for he city business tax. Bummer. Sounds like you’ll have to deal with the LA City tax department and convince them that you “misspoke” when you called it a business.</p>
<p>^but shouldn’t business tax be around 109 dollars? (At least when I looked it up) and not around 1000 dollars a year? technically I shouldn’t have to pay anything because its a creative artist transaction… I might have to convince them it was a prize money from a competition because that’s basically what it really was (I drew a picture, it won, and then they allowed me to do two more pictures for a price). I wish I knew about this sooner because I shouldn’t have to pay a dime…grr</p>
<p>Perhaps you could ask one of your art profs for advice, preferably one you know that takes on outside work.</p>
<p>It might not be “taxes” per-se, but a business license you did not apply for, and the resulting penalties. If they do claim you are a business, the sheer volume (or lack thereof) may qualify you for an exemption from a license. Note: They are only looking for your “business income”, not your “total income”. Don’t worry about income that was reported on W-2’s (work study).</p>
<p>I claimed it was actually prize money from a drawing competition and I called it a business accidentally. I called them and the nice lady told me to write them a letter explaining the situation which I did yesterday…</p>
<p>The business license is around 100 dollar and I think the pentalty max is usually around 40 dollars. I shouldn’t get in trouble for years with no income (2008 + 2009) so it should max around 140… or so I hope.</p>
<p>The lady said the letters were automatically generated so I shouldn’t have to worry about that amount. I just wrote in the letter I’ve sent them that I was a college student and didn’t really own a business, blah blah… T_T</p>
<p>Next time I’m applying for creative artist tax exemption program…Or not doing my taxes at all since I shouldn’t have to due to low income! URGH it’s just that my mother made me so I could attempt to become a california citizen (I don’t have a real home state anymore)!! URGH</p>